Substandard industrial gas, hydropower emissions units banned from New Zealand trading scheme

Source:Xinhua Published: 2012-12-17 10:57:23

The New Zealand government announced Monday it is banning some international emissions units from the country's budding emissions trading scheme (ETS) because of concerns over their "environmental integrity."

Climate Change Minister Tim Groser said the government was banning international units generated from industrial gas destruction projects and large hydropower projects that did not meet World Commission on Dams guidelines.

"This change is about ensuring the environmental integrity of the New Zealand emissions trading scheme is maintained," Groser said in a statement.

"Australia and the European Union have already announced their intention to restrict these units from their emissions trading schemes. Banning these units now strengthens the integrity of the ETS and therefore our ability to advance discussions on linking with other major domestic emissions trading schemes."

The ban was not expected to significantly reduce the supply of units in the period up to 2015 and was therefore expected to have no impact on the carbon price.

Emitters who had already committed to purchase such units in forward contracts would be able to use them for surrender obligations until June 2014, providing contracts were entered into prior to Monday.

"The government is exploring regional and bilateral linkages amongst carbon markets for beyond 2015," Groser said.

The New Zealand government has drawn criticism this year for watering down the requirements for its ETS and for announcing last month that it would not be signing up to a second commitment period on greenhouse gas emissions under the Kyoto Protocol, opting instead to take an emissions pledge under the United Nations Framework Agreement on Climate Change from Jan. 1 next year.

The controversial move would align New Zealand's climate change efforts with a group of developed and developing countries that were collectively responsible for 85 percent of global emissions, including the United States, Japan, China, India, Canada, Brazil and Russia.

According to the United Nations, the major distinction between the Protocol and the Convention is that the Convention just encourages industrialized countries to stabilize emissions, while the Protocol commits them to doing so.

Posted in: Asia-Pacific, Green

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